The Federal Court of Australia has imposed a $10 million civil penalty on the Australia and New Zealand Banking Group Limited (ANZ) for engaging in unconscionable conduct. The court declared that ANZ breached its obligation to comply with financial services laws and failed to ensure that the services covered by its licence were provided efficiently, honestly, and fairly.
ANZ admitted to charging non-payment fees and transaction fees on 327,895 occasions between July 26, 2013, and September 24, 2015. These charges were applied to non-loan retail customers and commercial customers for periodical payments between accounts under the same name without contractual entitlement. ANZ was aware of this risk from July 11, 2011.
Additionally, ANZ did not make remediation payments after December 11, 2013, to affected customers who were charged these fees without contractual entitlement between July 11, 2005, and December 31, 2007.
The court found that ANZ's actions constituted unconscionable conduct under s12CB(1) of the Australian Securities and Investments Commission Act 2001. It also breached sections s912A(1)(c) and s912A(1)(a) of the Corporations Act 2001 by failing to comply with financial services laws and not providing services efficiently or fairly.
The Charging Conduct impacted approximately 69,000 customers with a total fee value of $3,101,102.90 charged without contractual entitlement. Remediation payments totaling $2,570,327.39 have been made to some affected customers.
There remains an unpaid amount of $637,901.60 in remediation payments which will be paid to ASIC as unclaimed moneys or donated to charity.
In relation to the Remediation Conduct involving about 175,000 fees valued at approximately $3 million in total charges without entitlement: apart from those receiving class action settlement payments related to certain periodical payment fees charging issues; ANZ has not compensated these customers.
Further information can be found at [ASIC's website](https://asic.gov.au/about-asic/news-centre/find-a-media-release/2020-releases/20-232mr-anz-to-pay-10-million-penalty-for-unconscionable-conduct-over-periodic-payment-fees/).